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1 LAW OFFICE OF WAYNE A.

SILVER
Wayne A. Silver, Esq. (108135)
2 1674 N. Shoreline Blvd., Suite 140
3 Mountain View, CA 94043
Phone: (650) 282-5970
4 Facsimile: (650) 282-5980
Email: ws@waynesilverlaw.com;
5 w_silver@sbcglobal.net
6 Attorney for Creditors and Interested Parties
SANDBOX, LLC and JUSTIN BUNNELL
7
UNITED STATES BANKRUPTCY COURT
8
NORTHERN DISTRICT OF CALIFORNIA
9
OAKLAND DIVISION
10
11 In re: Case No.: 18-40029-RLE
Chapter 11
12 AVICENNA DEVELOPMENT
CORPORATION,
13
Debtor.
14
In re: Case No.: 18-40030-RLE
15 Chapter 11
CONLAN PRESS, INCORPORATED,
16
Debtor.
17
In re: Case No.: 18-40032-RLE
18 Chapter 11
CONNOR FREFF COCHRAN,
19 RS No. WS-1001
20 Debtor.
Date: April 25, 2018
Time: 2:00 p.m.
21 Court: 201, Hon. Roger L. Efremsky
22
SANDBOX, LLC AND JUSTIN BUNNELL’S
23 OMNIBUS REQUEST FOR JUDICIAL NOTICE
24 Creditors and interested parties SANDBOX, LLC (“Sandbox”) and JUSTIN BUNNELL

25 (“Bunnell”) (“Movants”), request the Court take judicial notice under Federal Rule of Evidence 201

26 of the following pleadings, declarations, Orders and other documents in the Court’s files in each of

27 the above-referenced bankruptcy cases:

28

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Sandbox, LLC and Justin Bunnell’s Omnibus Request for Judicial Notice
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Case: 18-40032 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27 Page 2 of
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EXHIBIT ONE

Sandbox, LLC and Justin Bunnell’s Opposition To Creditor Peter
S. Beagle’s Motion for Relief from Stay

Case: 18-40032 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27 Page 3 of
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1 LAW OFFICE OF WAYNE A. SILVER
Wayne A. Silver, Esq. (108135)
2 1674 N. Shoreline Blvd., Suite 140
3 Mountain View, CA 94043
Phone: (650) 282-5970
4 Facsimile: (650) 282-5980
Email: ws@waynesilverlaw.com;
5 w_silver@sbcglobal.net
6 Attorney for Creditors and Interested Parties
SANDBOX, LLC and JUSTIN BUNNELL
7
UNITED STATES BANKRUPTCY COURT
8
NORTHERN DISTRICT OF CALIFORNIA
9
OAKLAND DIVISION
10
11 In re: Case No.: 18-40029-RLE
Chapter 11
12 AVICENNA DEVELOPMENT
CORPORATION,
13
Debtor.
14
In re: Case No.: 18-40030-RLE
15 Chapter 11
CONLAN PRESS, INCORPORATED,
16
Debtor.
17
In re: Case No.: 18-40032-RLE
18 Chapter 11
CONNOR FRETT COCHRAN,
19 Debtor. Date: March 14, 2018
Time: 2:00 p.m.
20 Court: 201, Hon. Roger L. Efremsky
21 SANDBOX, LLC AND JUSTIN BUNNELL’S OPPOSITION
22 TO CREDITOR PETER S. BEAGLE’S MOTION FOR RELIEF FROM STAY

23 Creditors and interested parties SANDBOX, LLC (“Sandbox”) and JUSTIN BUNNELL
24 (“Bunnell”) (“Creditors”) oppose the motion of creditor Peter S. Beagle (“Beagle”) for Relief from
25 Stay (“Motion”) to pursue pending litigation against the above-named Debtors in the Alameda
26 Superior Court, Case No. RG15794528 (the “Beagle Lawsuit”).
27 Beagle’s Motion admits his central contention is “[T]hat his intellectual property was
28 fraudulently taken from him, such that it should determined not to be the property of any defendant

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1 or property of any defendant’s Chapter 11 estate.” (Motion1, p.2:7-9) This stems from the Eleventh

2 Cause of Action for Constructive Trust in Beagle’s Complaint (attached as Exhibit One to the

3 Declaration of Kathleen A. Hunt (“Beagle Complaint”)) which seeks “[A] declaration that

4 fraudulently and improperly conveyed assets are held in trust for the benefit of Beagle.” (Beagle

5 Complaint, pp.27-28, 34). These allegedly “fraudulently and improperly conveyed assets” are

6 described as “all of his [Beagle’s] intellectual property” (“IP Assets”)(See, Declaration of Peter S.

7 Beagle, pp.2:8 – 13; Beagle Complaint, pp.5:23 – 28; 6:15; 8 ¶25; 10 ¶31; 17 ¶64.)

8 Avicenna’s IP Assets are valued at $7,262,000 in Avicenna’s bankruptcy schedules2 and

9 comprise about ninety-seven percent (97%) of Avicenna’s total assets. The Court is requested to take

10 judicial notice that virtually all of the value in each of the above-named Chapter 11 estates arises from

11 these intellectual property assets held by Avicenna.

12 Beagle’s Motion asks this Court to enter an order “[G]ranting relief from the automatic stay to

13 allow him to proceed to completion and judgment in the State Court Action, including to determine

14 ownership of the intellectual property at issue…” (Motion, p.4:2 – 4) If this Court allows Beagle to

15 proceed with that determination in the Beagle Lawsuit, with a constructive trust imposed over those IP

16 Assets, nothing will be left for other creditors. As discussed below, this outcome does not meet the

17 “Curtis Factors” because of the severe impact on the bankruptcy estate and creditors,

18 Bunnell was defrauded by Connor Cochran, who conned Bunnell out of $300,000 and into

19 forming Sandbox, LLC to enter into a bogus Joint Venture Agreement with Cochran. This $300,000

20 was to be used in connection with Avicenna’s promotion and marketing of a preexisting animated

21 feature-length film based upon the acclaimed science fiction novel titled “The Last Unicorn” written

22 by Beagle. (See, Omnibus Declaration of Michael A. Trauben (the “Trauben Decl.”), ¶4, filed

23 concurrently herewith). But as alleged in the First Amended Complaint in Sandbox LLC v. Avicenna

24 and Cochran (“Defendants”) filed in the Los Angeles County Superior Court, Case No. BC605386

25
26 1
Omnibus Motion of Creditor Peter S. Beagle for Relief from Automatic Stay for Cause
27 Under 11 U.S.C. § 362(d)(1)
2
The Court is requested to take judicial notice of Avicenna Bankruptcy Schedule “B”, Part 10, as
28 filed on 1/18/2018, Docket No. 12.

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1 (“Sandbox Lawsuit”), a copy of which is attached as Exhibit “A” to the Trauben Decl., Cochran, the

2 principal in Avicenna, misappropriated and converted the $300,000.00 provided to Avicenna for

3 Cochran’s personal use, in direct contravention of the agreement between Sandbox and Avicenna.

4 The FAC further alleges that Cochran fraudulently induced Bunnell to enter into the agreement by

5 making material misrepresentations to Bunnell. (See, Trauben Decl., ¶5 and FAC, ¶¶3 – 5, 39, 85 –

6 91).

7 After the Sandbox Lawsuit was filed and despite Defendants’ failures to properly respond to

8 discovery directed at Defendants’ alleged use of the $300,000.00 that was transferred to Avicenna,

9 Creditors were able to locate documents reflecting Cochran’s diversion of funds from Avicenna for

10 personal use. (See, Trauben Decl., ¶7) A subsequent mediation in the Sandbox Lawsuit resulted in a

11 settlement on or about October 28, 2016, memorialized in a Short Form Settlement Agreement

12 (“Settlement Agreement”). The Settlement Agreement was adopted and attached to the Statements

13 Authorizing Confession of Judgment by Defendants Avicenna and Cochran on November 15, 2016,

14 true and correct copies of which are attached to the Trauben Decl. as Exhibits “B” and “C”,

15 respectively. These Statements Authorizing Confession of Judgment provide for a joint and several

16 judgment in the amount of $400,000.00 against Defendants in favor of Sandbox, Bunnell and related

17 entities, should Defendants fail to pay $400,000.00 to Bunnell on or before December 29, 2017.

18 (Trauben Decl., ¶8)

19 9 Pursuant to the Settlement Agreement, Sandbox dismissed the Sandbox Lawsuit with

20 prejudice on November 29, 2016, however Defendants failed and/or refused to pay anything to either

21 Bunnell, Sandbox, or any of the related entities under the Settlement Agreement. (Trauben Decl., ¶9

22 – 10)

23 The Motion correctly points out this Court’s decision should be guided by the “Curtis Factors”

24 articulated in In re Curtis, 40 B.R. 795, 799-800 (Bankr. D. Utah 1984), and adopted in Truebro, Inc.

25 v. Plumberex Specialty Prods., Inc. (In re Plumberex Specialty Prods., Inc.), 311 B.R. 551, 559-60

26 (Bankr. C.D. Cal. 2004) and cited with approval in Kronemyer v. Am. Contractors Indem. Co. (In re

27 Kronemyer), 405 B.R. 915, 921 (9th Cir. BAP 2009). The Motion fails to point out however, that in

28

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1 weighing the relevant factors, the bankruptcy court is not required to give equal weight to all factors,

2 and:

3 In fact, the balancing of potential harm to the creditor on the one hand
and to the debtor and the bankruptcy estate on the other hand
4 frequently is dispositive. Compare Green v. Brotman Med. Ctr., Inc.
(In re Brotman Med. Ctr., Inc.), 2008 Bankr. LEXIS 4692, 2008 WL
5
8444797, at *6 (Mem. Dec.) (9th Cir. BAP Aug. 15, 2008) ("the
6 bankruptcy court must balance the potential hardship that will be
incurred by the party seeking relief if the stay is not lifted against the
7 potential prejudice to the debtor and the bankruptcy estate") with In re
Curtis, 40 B.R. at 806 ("The most important factor in determining
8
whether to grant relief from the automatic stay to permit litigation
9 against the debtor in another forum is the effect of such litigation on
the administration of the estate. Even slight interference with the
10 administration may be enough to preclude relief in the absence of a
11 commensurate benefit."). LaPierre v. Advanced Med. SPA Inc. (In re
Advanced Med. SPA Inc.), 2016 Bankr. LEXIS 4084, at *10-11 (9th
12 Cir. BAP 2016)
13 The Motion incorrectly analyzes the critical second Curtis Factor (lack of any connection

14 with or interference with the bankruptcy case) and in conclusory fashion states “The State Law

15 Action was on the verge of trial, so any disruption to the conduct of the bankruptcy case should be

16 minimal. If the matter proceeded in bankruptcy court, delays would result.” (Motion, p.6:7 – 9)). In

17 fact, if the Beagle Lawsuit is allowed to proceed while the other creditors remain “frozen,” Beagle

18 will be allowed to leapfrog ahead of other creditors and become the beneficiary of a constructive

19 trust holding the IP Assets. But for these Bankruptcy Cases, Sandbox and Bunnell would have

20 judgments against Avicenna and Cochran, which by now could have been secured against the IP

21 Assets through post-judgment collection procedures.3

22 Beagle’s Motion is the antithesis to one the fundamental purposes of the automatic stay,

23 which is to prevent creditors from racing to be the first to claim a debtor’s limited assets which

24 frustrates the equitable distribution of assets to creditors. (Gasprom, Inc. v. Fateh (In re Gasprom,

25 Inc.), 500 B.R. 598, 606 (9th Cir. BAP 2013)) The Motion, with respect to lifting the stay to allow

26
3
27 Trauben Decl., ¶¶6, 11 – 13). See, Office Depot, Inc. v. Zuccarini, 596 F. 3d 696 (9th Cir. 2010) (a
judgment creditor can levy a domain name of a judgment debtor to satisfy his judgment) and Cal.
28 Code Civ. Proc. §§708.620, 708.630, 699.720 (appointment of a receiver in aid of execution).

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1 imposition of a constructive trust over the IP Assets, fails to establish “cause” under the Curtis

2 Factors, and should therefore be denied as to that specific relief. Sandbox and Bunnell have no

3 objection however, to a limited stay relief order allowing Beagle to liquidate the amount of his

4 claims.

5 Dated: March 12, 2018 /s/ Wayne A. Silver
Wayne A. Silver, attorney for SANDBOX,
6 LLC and JUSTIN BUNNELL
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EXHIBIT TWO

Omnibus Declaration of Michael A. Trauben

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Case: 18-40032
 Doc# 38-2 Filed: 04/05/186LQJK
7UDXEHQ
Entered: 04/05/18 11:28:27
 Page 14
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Case: 18-40032 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27 Page 26
of 49
Case: 18-40032 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27 Page 27
of 49
EXHIBIT “A”

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Case: 18-40032
 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27
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EXHIBIT THREE

Orders Granting Omnibus Motion of Creditor Peter S. Beagle for
Relief from Automatic Stay for Cause Under 11 U.S.C. §
362(d)(1)

Case: 18-40032 Doc# 38-2 Filed: 04/05/18 Entered: 04/05/18 11:28:27 Page 31
of 49
Entered on Docket
March 23, 2018
EDWARD J. EMMONS, CLERK
U.S. BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA

1
2 KATHLEEN A. HUNT SBN 230678
UNIQUE LAW
3 6002 Barrett Ave The following constitutes
El Cerrito, CA 94530-1415 the order of the court. Signed March 23, 2018
4 Telephone (510) 289-2288
Email: kathleenhunt@uniquelaw.com
5
Attorney for Creditor/Movant
6 PETER S. BEAGLE ______________________________________________
Roger L. Efremsky
7 UNITED STATESU.S. Bankruptcy Judge
NORTHERN DISTRICT OF CALIFORNIA
8 OAKLAND DIVISION
9 In re )
) Case. No. 18-40029 RLE
10 AVICENNA DEVELOPMENT ) RS No. UL-001
CORPORATION, )
11 )
Debtor. )
12 _________________________________ )
)
13 In re ) Case. No. 18-40030 RLE
) RS No. UL-001
14 CONLAN PRESS, INCORPORATED )
)
15 Debtor. )
_________________________________ )
16 )
In re ) Case. No. 18-40032 RLE
17 ) RS No. UL-001
CONNOR FREFF COCHRAN, )
18 ) ORDER GRANTING OMNIBUS MOTION
Debtor. ) OF CREDITOR PETER S. BEAGLE FOR
19 ) RELIEF FROM AUTOMATIC STAY FOR
) CAUSE UNDER 11 U.S.C. § 362(d)(1)
20 )
) Hearing Date: March 14, 2018
21 ) Time: 2:00 p.m.
) Courtroom: 201
22 ) United States Bankruptcy Court
) 1300 Clay Street, 2nd Floor, Oakland, CA
23 _________________________________ )
24 THIS COURT conducted a hearing at the above-specified time and place on the omnibus
25 motion (“Motion”)1 of Movant Peter S. Beagle seeking an order terminating and annulling the
26
27 1
The motion was lodged in the above-captioned cases as follows: 18-40029 [Docket No. 17];
28 Case. No. 18-40030 [Docket No. 19]; and Case. No. 18-40032 [Docket No. 23]. Capitalized terms
not defined herein shall have the meanings assigned in the Motion.

Case:
Case:18-40029
18-40032 Doc#
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1 automatic stay herein under 11 U.S.C. §§ 105(a) and 362(d)(1) for cause to allow him to pursue,
2 prosecute and liquidate his claims against the above-captioned debtors in the State Court
3 Action. Appearances were noted on the record. The court finds that notice of the Motion was
4 proper and that for the reasons stated on the record at the hearing, good cause exists to grant the
5 relief requested by the Motion and to grant related relief.
6 NOW, THEREFORE, IT IS HEREBY ORDERED that:
7 1. The Motion is GRANTED.
8 2. The automatic stay herein is modified to allow Movant to litigate and obtain a
9 final judgment in the State Court Action.
10 3. The objections of creditors and objecting parties Sandbox, LLC and Justin
11 Bunnell are OVERRULED provided, however, that said creditors are entitled to intervene in the
12 State Court Action to the extent allowable under applicable nonbankruptcy law.
13 4. No party may execute on any judgment entered in the State Court Action pending
14 further order of this court.
15 5. The 14-day stay under Fed.R.Bankr.P. 4001(a)(3) is WAIVED with respect to the
16 relief granted hereunder.
17 APPROVED AS TO FORM:
18 LAW OFFICE OF WAYNE A. SILVER
19 /s/ Wayne A. Silver, Esq. SBN 108135
Attorney for Creditors/Objecting Parties
20 SANDBOX, LLC and JUSTIN BUNNELL
21
LAW OFFICE OF JOHN H. CARMICHAEL
22
/s/ John H. Carmichael SBN 196416
23 Attorney for Debtors/Respondents
24 * * END OF ORDER * *
25
26
27
28

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Entered on Docket
March 23, 2018
EDWARD J. EMMONS, CLERK
U.S. BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA

1
2 KATHLEEN A. HUNT SBN 230678
UNIQUE LAW
3 6002 Barrett Ave The following constitutes
El Cerrito, CA 94530-1415 the order of the court. Signed March 23, 2018
4 Telephone (510) 289-2288
Email: kathleenhunt@uniquelaw.com
5
Attorney for Creditor/Movant
6 PETER S. BEAGLE ______________________________________________
Roger L. Efremsky
7 UNITED STATESU.S. Bankruptcy Judge
NORTHERN DISTRICT OF CALIFORNIA
8 OAKLAND DIVISION
9 In re )
) Case. No. 18-40029 RLE
10 AVICENNA DEVELOPMENT ) RS No. UL-001
CORPORATION, )
11 )
Debtor. )
12 _________________________________ )
)
13 In re ) Case. No. 18-40030 RLE
) RS No. UL-001
14 CONLAN PRESS, INCORPORATED )
)
15 Debtor. )
_________________________________ )
16 )
In re ) Case. No. 18-40032 RLE
17 ) RS No. UL-001
CONNOR FREFF COCHRAN, )
18 ) ORDER GRANTING OMNIBUS MOTION
Debtor. ) OF CREDITOR PETER S. BEAGLE FOR
19 ) RELIEF FROM AUTOMATIC STAY FOR
) CAUSE UNDER 11 U.S.C. § 362(d)(1)
20 )
) Hearing Date: March 14, 2018
21 ) Time: 2:00 p.m.
) Courtroom: 201
22 ) United States Bankruptcy Court
) 1300 Clay Street, 2nd Floor, Oakland, CA
23 _________________________________ )
24 THIS COURT conducted a hearing at the above-specified time and place on the omnibus
25 motion (“Motion”)1 of Movant Peter S. Beagle seeking an order terminating and annulling the
26
27 1
The motion was lodged in the above-captioned cases as follows: 18-40029 [Docket No. 17];
28 Case. No. 18-40030 [Docket No. 19]; and Case. No. 18-40032 [Docket No. 23]. Capitalized terms
not defined herein shall have the meanings assigned in the Motion.

Case:
Case:18-40032
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1 automatic stay herein under 11 U.S.C. §§ 105(a) and 362(d)(1) for cause to allow him to pursue,
2 prosecute and liquidate his claims against the above-captioned debtors in the State Court
3 Action. Appearances were noted on the record. The court finds that notice of the Motion was
4 proper and that for the reasons stated on the record at the hearing, good cause exists to grant the
5 relief requested by the Motion and to grant related relief.
6 NOW, THEREFORE, IT IS HEREBY ORDERED that:
7 1. The Motion is GRANTED.
8 2. The automatic stay herein is modified to allow Movant to litigate and obtain a
9 final judgment in the State Court Action.
10 3. The objections of creditors and objecting parties Sandbox, LLC and Justin
11 Bunnell are OVERRULED provided, however, that said creditors are entitled to intervene in the
12 State Court Action to the extent allowable under applicable nonbankruptcy law.
13 4. No party may execute on any judgment entered in the State Court Action pending
14 further order of this court.
15 5. The 14-day stay under Fed.R.Bankr.P. 4001(a)(3) is WAIVED with respect to the
16 relief granted hereunder.
17 APPROVED AS TO FORM:
18 LAW OFFICE OF WAYNE A. SILVER
19 /s/ Wayne A. Silver, Esq. SBN 108135
Attorney for Creditors/Objecting Parties
20 SANDBOX, LLC and JUSTIN BUNNELL
21
LAW OFFICE OF JOHN H. CARMICHAEL
22
/s/ John H. Carmichael SBN 196416
23 Attorney for Debtors/Respondents
24 * * END OF ORDER * *
25
26
27
28

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Entered on Docket
March 23, 2018
EDWARD J. EMMONS, CLERK
U.S. BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA

1
2 KATHLEEN A. HUNT SBN 230678
UNIQUE LAW
3 6002 Barrett Ave The following constitutes
El Cerrito, CA 94530-1415 the order of the court. Signed March 23, 2018
4 Telephone (510) 289-2288
Email: kathleenhunt@uniquelaw.com
5
Attorney for Creditor/Movant
6 PETER S. BEAGLE ______________________________________________
Roger L. Efremsky
7 UNITED STATESU.S. Bankruptcy Judge
NORTHERN DISTRICT OF CALIFORNIA
8 OAKLAND DIVISION
9 In re )
) Case. No. 18-40029 RLE
10 AVICENNA DEVELOPMENT ) RS No. UL-001
CORPORATION, )
11 )
Debtor. )
12 _________________________________ )
)
13 In re ) Case. No. 18-40030 RLE
) RS No. UL-001
14 CONLAN PRESS, INCORPORATED )
)
15 Debtor. )
_________________________________ )
16 )
In re ) Case. No. 18-40032 RLE
17 ) RS No. UL-001
CONNOR FREFF COCHRAN, )
18 ) ORDER GRANTING OMNIBUS MOTION
Debtor. ) OF CREDITOR PETER S. BEAGLE FOR
19 ) RELIEF FROM AUTOMATIC STAY FOR
) CAUSE UNDER 11 U.S.C. § 362(d)(1)
20 )
) Hearing Date: March 14, 2018
21 ) Time: 2:00 p.m.
) Courtroom: 201
22 ) United States Bankruptcy Court
) 1300 Clay Street, 2nd Floor, Oakland, CA
23 _________________________________ )
24 THIS COURT conducted a hearing at the above-specified time and place on the omnibus
25 motion (“Motion”)1 of Movant Peter S. Beagle seeking an order terminating and annulling the
26
27 1
The motion was lodged in the above-captioned cases as follows: 18-40029 [Docket No. 17];
28 Case. No. 18-40030 [Docket No. 19]; and Case. No. 18-40032 [Docket No. 23]. Capitalized terms
not defined herein shall have the meanings assigned in the Motion.

Case:
Case:18-40030
18-40032 Doc#
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1 automatic stay herein under 11 U.S.C. §§ 105(a) and 362(d)(1) for cause to allow him to pursue,
2 prosecute and liquidate his claims against the above-captioned debtors in the State Court
3 Action. Appearances were noted on the record. The court finds that notice of the Motion was
4 proper and that for the reasons stated on the record at the hearing, good cause exists to grant the
5 relief requested by the Motion and to grant related relief.
6 NOW, THEREFORE, IT IS HEREBY ORDERED that:
7 1. The Motion is GRANTED.
8 2. The automatic stay herein is modified to allow Movant to litigate and obtain a
9 final judgment in the State Court Action.
10 3. The objections of creditors and objecting parties Sandbox, LLC and Justin
11 Bunnell are OVERRULED provided, however, that said creditors are entitled to intervene in the
12 State Court Action to the extent allowable under applicable nonbankruptcy law.
13 4. No party may execute on any judgment entered in the State Court Action pending
14 further order of this court.
15 5. The 14-day stay under Fed.R.Bankr.P. 4001(a)(3) is WAIVED with respect to the
16 relief granted hereunder.
17 APPROVED AS TO FORM:
18 LAW OFFICE OF WAYNE A. SILVER
19 /s/ Wayne A. Silver, Esq. SBN 108135
Attorney for Creditors/Objecting Parties
20 SANDBOX, LLC and JUSTIN BUNNELL
21
LAW OFFICE OF JOHN H. CARMICHAEL
22
/s/ John H. Carmichael SBN 196416
23 Attorney for Debtors/Respondents
24 * * END OF ORDER * *
25
26
27
28

Case:
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EXHIBIT FOUR

Omnibus Motion of Creditor Peter S. Beagle for Relief from
Automatic Stay for Cause Under 11 U.S.C. § 362(d)(1)

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1 KATHLEEN A. HUNT SBN 230678
UNIQUE LAW
2 6002 Barrett Ave
El Cerrito, CA 94530-1415
3 Telephone (510) 289-2288
Email: kathleenhunt@uniquelaw.com
4
Attorney for Creditor/Movant
5 PETER S. BEAGLE
6 UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF CALIFORNIA
7 OAKLAND DIVISION
8 In re )
)
9 AVICENNA DEVELOPMENT ) Case. No. 18-40029 RLE
CORPORATION, ) RS No. UL-001
10 )
Debtor. )
11 __________________________________ )
In re )
12 )
CONLAN PRESS, INCORPORATED ) Case. No. 18-40030 RLE
13 ) RS No. UL-001
Debtor. )
14 __________________________________ )
)
15 In re )
) Case. No. 18-40032 RLE
16 CONNOR FREFF COCHRAN, ) RS No. UL-001
)
17 Debtor. )
) OMNIBUS MOTION OF CREDITOR
18 ) PETER S. BEAGLE FOR RELIEF FROM
) AUTOMATIC STAY FOR CAUSE
19 ) UNDER 11 U.S.C. § 362(d)(1)
)
20 ) Hearing Date: March 14, 2018
) Time: 2:00 p.m.
21 ) Courtroom: 201
) United States Bankruptcy Court
22 __________________________________ ) 1300 Clay Street, 2nd Floor, Oakland, CA
23 Peter S. Beagle (“Movant” or “Beagle”), hereby submits this Memorandum of Points and
24 Authorities in Support of his Omnibus Motion for Relief from the Automatic Stay For Cause
25 Under 11 U.S.C. § 362 as follows:
26 I. INTRODUCTION
27 Beagle comprises by far the largest non-insider, general unsecured claim in this case. His
28 claims are based almost exclusively in state law causes of action and are the subject of a state

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1 court lawsuit that was set for a jury trial on January 5, 2018, the day after the petition date of
2 the three above-captioned Chapter 11 cases.
3 Movant is an award-winning author who was abused, defrauded and defamed by his
4 former business manager Connor Freff Cochran (“Cochran”) and two California corporations
5 controlled by Cochran: Avicenna Development Corporation (“Avicenna”) and Conlan Press,
6 Inc. (“Conlan”), each Chapter 11 debtors in this court.
7 Movant’s central contention is that his intellectual property was fraudulently taken from
8 him, such that it should determined not to be the property of any defendant or property of any
9 defendant’s Chapter 11 estate.
10 Movant seeks relief from the automatic stay pursuant to § 362(d)(1) and (d)(2) of the
11 Bankruptcy Code for authority to exercise all of his rights and remedies in the state court action,
12 and is entitled to relief from the automatic stay on the following bases: (i) The so-called Curtis
13 factors, used by bankruptcy courts in determining whether the stay should be lifted to allow
14 state court matters to go forward, favor Movant overwhelmingly; and (ii) Judicial economy,
15 fairness and the ‘balance of hurt’ all support the relief sought.
16 II. STATEMENT OF FACTS AND STATE COURT PROCEDURAL HISTORY
17 The following facts are included in the Declaration of Peter S. Beagle, attached hereto as
18 EXHIBIT A.
19 1. Beagle and Cochran met in 2001. Cochran quickly insinuated himself into
20 Beagle’s business affairs and, four years on, formed a sole proprietorship as a vehicle to allow
21 Cochran to exercise control over the publication and sale of Beagle’s work. Eventually
22 Cochran convinced Beagle to transfer all of his intellectual property to Avicenna, not disclosing
23 that Beagle would lose all control over said intellectual property nor that Avicenna would lay
24 claim to all future intellectual property created by Beagle. Although Beagle became the 50%
25 owner of Avicenna at its formation in 2008, Cochran has at all times retained and exercised full
26 control over the company.
27 2. Over the years, Beagle reposed his faith and trust in Cochran but in June 2015,
28 in the course of an exhausting film tour, he accidentally forwarded Cochran an email, intended

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1 for Beagle’s attorney, detailing Cochran’s financial abuse of Beagle. In September 2015, having
2 begun to lose faith in Cochran and to question the parties’ business dealings, Beagle sent a
3 Shareholder Demand Letter to Avicenna, seeking information about the company’s financial
4 operations. He received no response. Finally, Beagle filed a Complaint against Cochran, Conlan
5 and Avicenna on November 24, 2015, in Alameda County Superior Court, case no.
6 RG15794528 (the “State Court Action”).
7 The following facts are included in the Declaration of Kathleen A. Hunt, attached
8 hereto as EXHIBIT B.
9 3. Attorney Kathleen A. Hunt of Unique Law has been counsel of record for
10 Movant in the State Court Action since its inception.
11 4. On November 24, 2015, Beagle filed and served the State Court Action alleging
12 fifteen separate causes of action including elder abuse, fraud, constructive fraud, intentional
13 infliction of emotional distress, defamation, breach of contract, breach of fiduciary duty,
14 conversion, and unfair business practices, and made a concurrent jury demand.
15 5. On January 5, 2016, debtors/defendants filed a Cross-Complaint (later amended)
16 against Beagle, his attorney Kathleen Hunt, and a third party. On September 23, 2016, the Court
17 granted Ms. Hunt’s motion for attorney’s fees related to her successful anti-SLAPP motion
18 against debtors/defendants for the portion of the Cross-Complaint related to her.
19 6. On October 24, 2017, an order was entered in the State Court Action granting in
20 part and denying in part defendants’ motion for judgment on the pleadings. Fourteen of
21 Movant’s 15 causes of action in the State Court Action survived said motion.
22 7. On November 7, 2017, an order was entered providing, among other relief: i)
23 Beagle’s motion for terminating sanctions as to defendants’ remaining Cross-Complaint was
24 granted and said Cross-Complaint was dismissed with prejudice; ii) defendants were ordered to
25 pay Movant’s counsel, within 30 days, the amount of $24,915 in attorney’s fees and costs,
26 which were awarded on September 23, 2016; iii) various deadlines for defendants to produce
27 discovery were established; and iv) defendant Cochran was sanctioned in the amount of $3,060.
28 8. Literally on the eve of commencement of a jury trial in the State Court Action,

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1 each of the defendants filed petitions for Chapter 11 relief in this court.
2 Beagle respectfully requests that the Court Order enter an order (A) granting relief from
3 the automatic stay to allow him to proceed to completion and judgment in the State Court
4 Action, including to determine ownership of the intellectual property at issue, but not to enforce
5 or collect on any monetary award; (B) waiving the 14-day stay under Fed.R.Bankr.P.
6 4001(a)(3); and (C) granting such other and further relief as this deemed necessary and proper.
7 III. ARGUMENT
8 A. Legal Standard. Section 362(d)(1) of the Bankruptcy Code provides in relevant part:
9 “On request of a party in interest and after notice and a hearing, the court shall grant relief from
10 the stay provided under subsection (a) of this section, such as by terminating, annulling,
11 modifying, or conditioning such stay – (1) for cause[.]” 11 U.S.C. § 362(d)(1). As the parties
12 seeking relief, Movant must first establish that cause exists for relief under § 362(d)(1). U.S. v.
13 Gould (In re Gould), 401 B.R. 415, 426 (9th Cir. BAP 2009) (internal citation omitted). Once a
14 prima facie case has been established, the burden shifts to the debtor to show that relief from the
15 stay is not warranted. Id.
16 “Section 362 gives the bankruptcy court wide latitude in crafting relief from the
17 automatic stay, including the power to grant retroactive relief from the stay.” In re Schwartz,
18 954 F.2d 569, 572 (9th Cir. 1992); see also Allied Capital, Inc. v. Gibson (In re Gibson), 349
19 B.R. 54, 58 (Bankr. D. Idaho 2006) (“[I]t will often be more appropriate to permit proceedings
20 to continue in their place of origin, when no great prejudice to the bankruptcy estate would
21 result, in order to leave the parties to their chosen forum and to relieve the bankruptcy court
22 from many duties that may be handled elsewhere.” (internal citations omitted)).
23 Here, proceeding to trial in the State Court Action would promote judicial economy and
24 fairness in a situation where resolution of the parties’ issues is necessary to the formulation of
25 any Chapter 11 plan.
26 ///
27 ///
28 ///

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1 B. The Court Should Exercise its Discretion and Lift the Automatic Stay Based on
2 the Relevant Curtis Factors.
3 Courts in the Ninth Circuit consult the so-called “Curtis Factors” in determining whether
4 cause exists to grant relief from stay involving a state court action, which factors are:
5 (1) Whether the relief will result in a partial or complete resolution of the issues;
6 (2) The lack of any connection with or interference with the bankruptcy case;
7 (3) Whether the foreign proceeding involves the debtor as a fiduciary;
8 (4) Whether a specialized tribunal has been established to hear the particular
9 cause of action and whether that tribunal has the expertise to hear such cases;
10 (5) Whether the debtor’s insurance carrier has assumed full financial
11 responsibility for defending the litigation;
12 (6) Whether the action essentially involves third parties, and the debtor functions
13 only as a bailee or conduit for the goods or proceeds in question;
14 (7) Whether the litigation in another forum would prejudice the interests of other
15 creditors, the creditor’s committee and other interested parties;
16 (8) Whether the judgment claim arising from the foreign action is subject to
17 equitable subordination;
18 (9) Whether movant’s success in the foreign proceeding would result in a judicial
19 lien avoidable by the debtor under Section 522(f);
20 (10) The interests of judicial economy and the expeditious and economical
21 determination of litigation for the parties;
22 (11) Whether the foreign proceedings have progressed to the point where the
23 parties are prepared for trial, and
24 (12) The impact of the stay and the “balance of hurt.”
25 In re Roger, 539 B.R. 837, 845 (C.D. Cal. 2015) (“The Ninth Circuit has recognized that ‘the
26 Curtis factors are appropriate, nonexclusive, factors to consider in deciding whether to grant
27 relief from the automatic stay to allow pending litigation to continue in another forum.’” (citing
28 In re Kronemyer, 405 B.R. 915, 921 (B.A.P. 9th Cir. 2009)).

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1 Taken together, the “Curtis” factors weigh strongly in favor of relief, to wit:
2 (1) Whether the relief will result in a partial or complete resolution of the issues: (i)
3 ownership of the subject intellectual property will be determined in state court, which
4 determination is a necessary predicate for any plan of reorganization in defendants’ cases; (ii)
5 Movant’s claims are based in, and on, state law; and (iii) denying stay relief would result in
6 litigation in bankruptcy court or abstention.1
7 (2) The lack of any connection with or interference with the bankruptcy case: The
8 State Law Action was on the verge of trial, so any disruption to the conduct of the bankruptcy
9 case should be minimal. If the matter proceeded in bankruptcy court, delays would result.
10 (3) Claims involving debtor as a fiduciary: Movant has a breach of fiduciary
11 claim against Cochran, which claim can be heard in state court as well as in bankruptcy court.
12 (4), (5), (6), (8), (9): Not applicable.
13 (7) Whether the litigation in another forum would prejudice the interests of other
14 creditors, the creditor’s committee and other interested parties: Favors Movant, who is by far
15 the largest holder of non-insider general unsecured claims. Liquidating and reducing these
16 claims through the state court process is the most efficient way to proceed.
17 (10) The interests of judicial economy and the expeditious and economical
18
19
1
Although abstention is not directly at issue here, “where a bankruptcy court may exercise
20 discretionary abstention in deciding issues related to [a] state court action, cause may exist for lifting the
21 stay as to the state court action. In re Castlerock Properties, 781 F.2d 159, 163 (9th Cir. 1986). Criteria
that bankruptcy courts should apply in discretionary abstention are: (1) the effect or lack thereof on the
22 efficient administration of the estate if a court recommends abstention, (2) the extent to which state law
issues predominate over bankruptcy issues, (3) the difficulty or unsettled nature of the applicable law,
23 (4) the presence of a related proceeding commenced in state court or other nonbankruptcy court, (5) the
jurisdictional basis, if any, other than 28 USC § 1334, (6) the degree of relatedness or remoteness of the
24
proceeding to the main bankruptcy case, (7) the substance rather than form of an asserted core
25 proceeding, (8) the feasibility of severing state law claims from core bankruptcy matters to allow
judgments to be entered in state court with enforcement left to the bankruptcy court, (9) the burden of
26 the bankruptcy court’s docket, (10) the likelihood that the commencement of the proceeding in
bankruptcy court involves forum shopping by one of the parties, (11) the existence of a right to a jury
27 trial, and (12) the presence in the proceeding of nondebtor parties. See Christensen v. Ward (In re
28 Tucson Estates, Inc.), 912 F.2d 1162, 1166 (9th Cir. 1990). Movant submits that, the applicable factors
favor Movant heavily and the remaining factors are either neutral at worst.
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1 determination of litigation for the parties: Favors Movant because, as stated, the state court trial
2 is ready to proceed and the issues being litigated are necessary to the formulation of any
3 confirmable Chapter 11 plan.
4 (11) Whether the foreign proceedings have progressed to the point where the
5 parties are prepared for trial: Clearly favors Movant, given that trial was set to begin just as
6 defendants were filing their Chapter 11 petitions.
7 (12) The impact of the stay and the “balance of hurt:” Favors Movant. (i)
8 Ownership of the disputed intellectual property will need to be determined, whatever the forum;
9 (ii) costs to the estate of litigating in state court should be minimal since discovery and pre-trial
10 litigation is concluded, so that trial can proceed expeditiously and, in any event, incurring such
11 litigation costs is not a sufficient basis to deny relief from stay, especially since the same issues
12 will need to be litigated in some forum, state or federal; (iii) Defendants should not be rewarded
13 for pursuing their eve-of-trial bankruptcy filings, which Movant submits amounts to an effort to
14 delay going to trial with him.
15 Thus the Curtis factors weigh in favor of allowing the State Court Action to proceed to
16 trial in state court.
17 C. Movant Should Be Allowed to Pursue His Claims As Quickly As Possible.
18 It is vital to any plan confirmation process or any other resolution of this case including
19 possible conversion to Chapter 7, that the universe of assets be identified and valued, most
20 importantly, the disputed intellectual property. Without certainty as to the ownership of said
21 property, the process of formulating a plan cannot even begin. While disclosure statements
22 often estimate potential returns to creditors, failure to resolve Movant’ claims in state court
23 would leave so large a range of possible values as to prevent unsecured creditors and other
24 creditors from calculating the value of consideration that they will receive under any proposed
25 plan.
26 Accordingly, liquidating Movant’ claims – and doing so promptly – is a necessary
27 prerequisite to determining the universe of property of the estate and amount of unsecured
28 claims in formulating and confirming a plan. See In re Hudgins, 102 B.R. 495, 497 (Bankr. E.D.
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1 Va. 1989) (liquidation of “largest single debt” “may be a necessary prerequisite to an attempt at
2 rehabilitation”). As a result further cause exists to lift the automatic stay for the purposes
3 specified herein.
4 Allowing this matter to proceed to trial in state court would be the most efficient and
5 cost-effective path to take, to the benefit of all creditors and parties in interest in these cases.
6 IV. CONCLUSION
7 For the reasons set forth above, Movant respectfully requests that this court enter an
8 order (A) granting relief from the automatic stay to allow Movant to proceed to completion and
9 judgment in the State Court Action, subject to the restrictions and stipulations set forth
10 hereinabove; (B) waiving the 14-day waiting period under Fed.R.Bankr.P. 4001(a)(3); and (C)
11 granting such other and further relief as this deemed necessary and proper.
12 Respectfully submitted,
13 Dated: February 22, 2018 UNIQUE LAW
14 By: /s/ Kathleen A. Hunt
15 Attorney for Creditor/Movant
PETER S. BEAGLE
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